EU Weighs 2014 Start Date for Basel Bank Rules Beset by Delays

By Jim Brunsden -
Feb 1, 2013

The European Union is weighing a Jan.
1, 2014, date for the gradual phase-in of Basel capital rules,
as the bloc struggles to agree on how to apply a global accord
designed to bolster defenses against future banking collapses.

The EU may also give bank regulators until the end of next
January to devise technical details fleshing out parts of the
so-called Basel III requirements, according to a document drawn
up by Ireland’s EU presidency and obtained by Bloomberg News.

The international bank rules have been beset by delays as
regulators across the world ponder how best to implement the
measures, which more than triple the core capital lenders must
hold and set standards for how lenders should manage risks. The
EU, like the U.S., missed the start-of-the-year deadline to
begin applying parts of the Basel III package.

The Basel Committee on Banking Supervision, the
international group that drew up the standards, agreed last
month to delay and water down another key part of the package
designed to ensure banks have enough easy-to-sell assets in a
crisis.

Michel Barnier, the EU’s financial services chief, said
yesterday that the EU and U.S. should implement the Basel
measures in parallel, starting in the “first weeks of 2014.”

The EU’s implementing law is being negotiated by the
European Parliament and national governments, which must reach
agreement on the substance and timetable for the rules before
they can take effect. Lawmakers have clashed with government
officials over a range of issues in the legislation, including
rules for systemically important lenders and caps on banker
bonuses.

A spokeswoman for Ireland’s EU presidency declined to
comment. The Irish document was drawn up as a basis for
discussion by diplomats ahead of negotiations with members of
the parliament.